Issue of Equity

RTS NetWorks Group PLC 17 January 2001 RTS NETWORKS GROUP PLC ('RTS NETWORKS' or 'COMPANY ') RTS NetWorks today announces that it has arranged an additional £3.0 million financing, in a mix of equity and convertible debt. The Company has raised £ 1.5 million via a placing of new ordinary shares with institutional and other investors, and £1.5 million in the form of a convertible loan facility offered by Robotic Technology Systems PLC ('Robotic Technology Systems'), its former parent company. This financing will serve notably to invest further in R & D, product development and related marketing and to better exploit the Company's intellectual property and anticipated growth. JM Finn, the Company's broker, has placed 4,166,667 new ordinary shares of 1p each at a price of 36p, raising £1.5 million for the Company. The shares have been placed with institutional and other investors. Application will be made for the new shares to be admitted to trading on AIM and it is expected that dealings will commence on 23 January 2001. RTS NetWorks has been notified in writing that, as a consequence of the placing, Advanced Robotics Foundation will increase its holding to 6,180,003 shares representing 6.5 per cent. of the enlarged issued share capital. As a further assurance the Company has agreed the terms of a convertible loan facility of £1.5 million from Robotic Technology Systems, to be drawn on if required. The loan is repayable in two equal instalments on 15 January 2002 and 15 July 2002 and convertible by Robotic Technology Systems into new ordinary shares of RTS NetWorks at 36 pence per share at any time following drawdown. Interest is payable at the rate of 2 per cent. above the base rate of National Westminster Bank plc. As part of the loan agreement, RTS NetWorks has granted warrants to Robotic Technology Systems to subscribe for 456,621 ordinary shares in the Company at an exercise price of 32.85 pence per share, representing a 10 per cent. discount to the mid-market price at the close of business on 15 January 2001 The warrants are exercisable between 15 January 2001 and 15 January 2007. RTS NetWorks has also granted JM Finn 268,500 warrants in part consideration of its fee relating to the placing. The warrants have been issued at an exercise price of 36 pence per share and are exercisable between 15 January 2001 and 15 January 2007. Robotic Technology Systems currently holds 34.65 per cent. of the issued share capital of the Company. As a result, the grant of the loan constitutes a related party transaction for the Company under the AIM Rules. It is the opinion of the directors of RTS NetWorks (excluding two who are also directors of Robotic Technology Systems and are therefore ineligible to vote), after consulting with the Company's Nominated Adviser, Brown, Shipley & Co. Limited, that the terms of the loan are fair and reasonable so far as shareholders of the Company are concerned.
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